- Cliffs Natural Resources' (CLF +12%) proposed note sale and offer to buy back some of its debt will improve its cash position but endanger its unsecured bondholders, according to researcher CreditSights.
- "The deal is a disturbing turn of events for unsecured bondholders just on the very negative structural subordination aspects of this deal... You’ll have a lot of secured debt that’s on top of the capital structure now,” CreditSights analyst Wen Li writes.
- S&P rated CLF’s unsecured notes BB- in an October report, but Li says the debt transaction makes the unsecured bonds appear to be more of a CCC-level quality.